Instructions

ZOOM IN by clicking on the page. A slider will appear, allowing you to adjust your zoom level. Return to the original size by clicking on the page again.

MOVE the page around when zoomed in by dragging it.

ADJUST the zoom using the slider on the top right.

ZOOM OUT by clicking on the zoomed-in page.

SEARCH by entering text in the search field and click on "In This Issue" or "All Issues" to search the current issue or the archive of back issues
respectively.
.

PRINT by clicking on thumbnails to select pages, and then press the
print button.

SHARE this publication and page.

ROTATE PAGE allows you to turn pages 90 degrees clockwise or counterclockwise.Click on the page to return to the original orientation. To zoom in on a rotated page, return the page to its original orientation, zoom in, and
then rotate it again.

CONTENTS displays a table of sections with thumbnails and descriptions.

ALL PAGES displays thumbnails of every page in the issue. Click on
a page to jump.

A15
SATURDAY,
JANUARY 10,
2015
• Twitter: @GuardianTT • Web: guardian.co.tt
Benchmark Brent crude and West
Texas Intermediate (WTI) resumed
their downward slide yesterday after
two days of relative calm, hitting their
lowest level since April, 2009, on
concerns about a global supply glut.
Benchmark Brent crude broke below
US$49 a barrel, drifting further below
the US$50 level, while WTI, which
trades within the price range of the light
sweet crudes produced in T&T, fell
below US$48.
Oil prices had barely moved on
Wednesday and Thursday after
tumbling ten per cent the first two days
of the week.
Early in New York trade, crude oil
drifted about 50 cents lower as robust
US jobs data for December helped limit
losses. However, just after noon Brent
was down by US$1.24 at US$49.71 a
barrel, after a session low at $48.90.
WTI traded 85 cents lower at US$47.94,
after falling to US$47.16 earlier.
In an address to the nation on
Thursday night, Prime Minister Kamla
Persad-Bissessar announced that the
national budget will now be pegged on
an oil price of US$45 a barrel and
US$2.25 per mmBtu for natural gas.
Brent crude continues downward slide
RADHICA SOOKRAJ AND
SHASTRI BOODAN
President of the Penal/Debe
Chamber of Industry and Com-
merce Sahid Hosein has described
government s response to declining
global energy prices as "irrespon-
sible and disappointing."
He told the T&T Guardian the
public offering of Phoenix Gas
Processors Ltd shares is not the best
method to deal with a $7.4 billion
budget shortfall.
"I understand it is a political party
and we are in an election year but
I would have thought that she would
have placed greater emphasis on
reducing expenditure by cutting sub-
sidies and transfers," Hosein said.
"You don t raise money by selling
shares just to spend it. You raise
money to invest so you can make
back a return on the investment. I
wish the oil price did not go down
andIamsadwearenotdoinga
good job for the future generations
in the same way that our parents
made sacrifices for us.
"One would expect that we use
the assets to bring in additional
income rather than to support sub-
sidies. I am very disappointed but
we have come to expect this pattern
of behaviour," he said.
Hosein said history shows that
the private sector is not prepared to
take risks.
"The State should have taken the
funds and invested in the energy
funds and then divested that to the
private sector," he said, adding that
citizens are "not stupid" and are well
informed about the repercussions of
falling oil prices.
"The public expected that some
hard measures would be taken and
if we cannot get the money to pay
the debts and subsidies it means that
we should have made serious adjust-
ments and start taking ten and 15
per cent from transfers and subsi-
dies," he said.
President of the San Fernando
Business Association, Daphne
Bartlett, said further adjustments
will have to be made to the budget
if the oil price remains low.
"We don t think it will go up again.
One expert said it will settle at US$62
a barrel but given what is happening
globally there is a chance that oil
price will remain low," she said.
Bartlett said she agreed with the
Prime Minister s proposal to take a
loan to finish the highway to Point
Fortin. She said the San Fernando
to Mayaro highway is also a worth-
while project. However, she added,
not enough is being done to make
work programmes more beneficial
to society.
"I also thought that the Prime
Minister should have addressed
diversification. The manufacturing
sector should be more robust but
we need more incentives and labour
as well because too many people
prefer to engage in government s
make-work schemes, rather than
to work in the private sector," she
said.
She said she was pleased that gov-
ernment did not touch the Heritage
and Stabilization Fund.
The Chaguanas Chamber of
Industry and Commerce wants Gov-
ernment to identify infrastructure
projects that will be put on the back-
burner, as well as the "non-critical
goods and services" so the business
sector will be better prepared for the
potential impact of these cost reduc-
tion measures
President Richie Sookhai while
said the chamber fully supports plans
for cut-backs in expenditure in
response to lower oil prices, they are
looking forward to "more concrete
and long-term steps."
He said: "We support the endeav-
ours of any government to diversify
the economy away from over
dependence on oil and energy
resources and note with interest the
Prime Minister s statement that her
Government will be intensifying its
collaboration for public/private part-
nerships as part of its adjustment in
priorities."
Sookhai said the Chaguanas
Chamber is ready and willing to dis-
cuss ways to "increase the private
sector footprint in our economy."
"Chaguanas is a growing hub for
education and industry and a diver-
sification into greater local manu-
facturing efforts in this part of the
country could be of benefit to the
entire country," he said.
Chambers disappointed
at budget adjustments
RAPHAEL JOHN-LALL
Prime Minister Kamla Persad-
Bissessar avoided having a "crit-
ical conversation" with the coun-
try about the economy when she
addressed the nation on Thursday
night, economist Dr Ronald
Ramkissoon said.
"Successive administrations,
including this one, have avoided
speaking to the population in a
way in which they would appre-
ciate the nature of the economy
and accept that we need to diver-
sify the economy. The Prime Min-
ister really avoided having that
critical conversation with the pop-
ulation. Much of the population
still does not understand the impli-
cation of the rise and fall of oil
prices. The population must know
that we must consume less and
save more," he said.
Referring to specific statistics
the Prime Minister gave in her
address, Ramkissoon said: "What
the figures she presented do is
forecast a larger deficit which is
to be funded partly by the fall in
the price of fuel and by the amount
of money the Government allo-
cates for subsidy. I do not agree
with the cut in the Public Sector
Investment Programme. This is
important for generating growth
in the long run, as distinct from
public expenditure on subsidies
and transfers and wages and
salaries which are recurrent expen-
diture.
"Capital expenditure is about
infrastructure which is important
in crowding the private sector to
bring them in the picture. It also
builds the foundation for growth
down the road and diversify the
economy," he said.
Ramkissoon described plans for
a public share offering in Phoenix
Park Gas Processors Limited as a
positive move and suggested that
divestment funding be used for
capital projects rather than recur-
rent consumption.
Hugh Howard, president of the
American Chamber of Commerce
of T&T (AmchamTT) agreed with
the decision to peg the national
budget on an oil price of US$45
dollars a barrel.
"Some pundits predict that oil
will be back up to $60 a barrel by
July. Assuming that the pundits
are correct, that means that the
Government will only benefit from
this for the balance two or three
months for the fiscal year," he said.
He expressed concern, however,
that the question of subsidies had
not been addressed.
"The Government should not
be providing a fuel subsidy for
people who can afford a half mil-
lion dollar car, or Gate for students
with parents who earn more than
a million dollars a year. The Gov-
ernment should be providing a
subsidy for public transportation
and Gate for students whose par-
ents earn lower incomes," he said.
The Trinidad and Tobago Man-
ufacturers Association (TTMA)
said the Government made a wise
decision to revisit the budgeted oil
and gas price and to reduce expen-
diture on infrastructure projects
for which financing have not yet
been committed.
"The Association believes that
the Government s intention to
divest specific state owned enter-
prises, namely shares in Phoenix
Park Gas Processors Ltd through
the stock exchange moves our
country in the right direction.
Such an initiative will allow for
direct participation in the energy
sector by the citizens of Trinidad
and Tobago," the group said in a
statement.
"We look forward to policy
measures that will spur increased
growth for manufacturing in 2015
and beyond, as we continue to play
our part in diversifying the econ-
omy. With the right diversification
framework set by the government,
the TTMA is confident that its
manufacturing sector will continue
its upward trajectory in a sustain-
able manner."
However, another business
organisation, the T&T Chamber
of Industry and Commerce said
the Prime Minister "avoided key
issues or disclosure of the need
for possibly tougher adjustments."
"We also believe that the Prime
Minister missed the opportunity
to take the nation into her confi-
dence in terms of sharing impor-
tant statistical projections in order
to adequately prepare ourselves for
the challenges ahead," the Cham-
ber said.
"The short-term measures pre-
sented lacked economic substance.
The T&T Chamber calls on the
Prime Minister to be more open
and transparent in sharing the key
underlying assumptions and their
likely impact on balance of pay-
ments as well as inter alia, foreign
exchange availability, the exchange
rate, interest and wages. These are
the details that businesses and
households need to make informed
decisions for their sustainability.
"The Prime Minister also missed
the opportunity to impress upon
the population the need for
restraint in these uncertain times."
Give more details
Business groups on budget adjustments:
Economist Dr Ronald Ramkissoon Hugh Howard, president of
AmchamTT.